Like most guidelines for maintaining good health, most guidelines for maintaining good client relations are simple, common sense-based concepts everyone knows. Just as with your health, circumstances can sometimes derail the best intentions for maintaining healthy client relations. This article offers some proven tips from the NHBA Insurance Agency, Inc., along with resources that can help restore healthy relations and keep your firm's prognosis positive.

Clients and Fees - Hesitate Before You Litigate

Suggestions from the NHBA Insurance Agency Inc.

If a client fails to pay their bill, think twice before filing suit to collect what you think they owe you. According to professional liability industry sources, when lawyers sue clients to recover fees, up to 50 percent of the time, the client responds by filing a counterclaim for malpractice.

What can a law firm do to prevent this, or, better yet, what can your firm do to avoid finding itself in this situation in the first place? The following are some Do's and Don'ts to help law firms establish clear expectations with their clients at the start, and provide for means of resolving disputes if they do occur, without resorting to the courts or disciplinary agencies.

DO: Have the client sign a fee-agreement letter that clearly spells out how you intend to charge for your services, and what your expectations are for payment. A series of model fee agreements are available in the NHBA's "Client Relations Handbook." This book, which contains a disk with forms, is available at no charge from the Bar (contact Member Services Coordinator Audrey Carrel at 224-6942) or by downloading them from www.nhbar.org. (The handbook and agreements are found under the "NH Practice Guidelines" section of the home page.)

DO: Require a retainer up front and mandate that it be replenished if it falls below a set dollar amount. Also, be sure your engagement letter clearly states that you expect your client to maintain a positive balance and that you may withdraw if fees are in arrears.

DO: Consider a mediation/arbitration provision in your fee agreement .The model agreements provided by the Bar include language that calls for the parties in an unresolvable fee dispute to allow the matter to be mediated by the Bar's Dispute Resolution Committee.

DON'T: Don't wait for a client to run up a large bill. Review your receivables on a monthly basis and deal with any that are over 60 days out or are larger than a certain set amount.

DON'T: Shirk from calling the client to find out why the bill hasn't been paid. Listen to the client's concerns, which may allow you the opportunity to cure the problem and resolve the issue quickly.

DO: Consider using the NHBA Dispute Resolution Committee to assist in resolving the dispute on an informal basis. For more information on the Bar's Dispute Resolution Committee, visit the "For Members" area of the NHBA Web site or contact Denice DeStefano at 224-6942 or at ddestefano@nhbar.org.

DO: Re-examine your actions and/or Ask another attorney objectively review your file. You need to dispassionately answer the question: "Was the matter handled in a way that was free of any action or omission that may lead to a counterclaim?"

Don't: Don't act hastily in filing collection litigation. Carefullyevaluate the likelihood of success and estimate the cost of your time and the effort that will be expended in pursuit of the fee. Is it worth it, or should you just write the matter off?

Don't: Ask someone else in your firm to look at the file. Seek an opinion from an outside source and listen to that advice.

Remember the best remedy for avoiding a fee dispute is to avoid it in the first place by emphasizing communication throughout the representation. Start with a clear agreement in writing. Regularly and openly communicate with clients about your expectations regarding payment of fees and expenses and listen closely to their expectations regarding the handling and outcome of their case. Make sure that the crucial points are put in writing and shared with the client.

"But It's Not About the Money..."

What about when the dispute is not regarding fees?

As mentioned above, the New Hampshire Bar Association Dispute Resolution Committee is designed to handle those disputes with attorneys that do not rise to the level of an ethical violation of the Rules of Professional Conduct. Examples of such disputes include those where an attorney is not returning phone calls, is not keeping the client informed as to what is happening with their case, is making excuses why their case is taking so long, will not relinquish a client's file if the attorney has been dismissed, as well as questions and/or disputes involving fees, etc.

The client or the attorney needs to put the dispute in writing and direct it to the NHBA Dispute Resolution Committee at the Bar's address. The attorney or the clientwill be notified of the complaint by a member of the Committee and asked if he/she would like the Committee to assist in resolving the dispute. The Bar Association has no authority to require an attorney or a clientparticipate in this process; it is voluntary on the part of the individual.

There is no cost for the services of the committee. The proceedings of the Dispute Resolution Committee are confidential. Its hearings, decisions and records are not open to the public, but may be reviewed by Dispute Resolution Committee members.

An Ounce of Prevention...

Resources you can use

The American Bar Association and the ABA's Law Practice Management Section offer useful information and resources on client relations. Visit them on the web at: http://www.abanet.org/lpm/home.shtml.

Closer to home, www.nhbar.org offers:

Model Fee Agreements

Client Relations Handbook

Continuing Legal Education Materials

Declaration of Commitment to Clients - Adopted by the NHBA Board of Governors in 1994, the Declaration of Commitment to Clients articulates undertakings and representations which plainly are at the heart of all client-lawyer relations. Copies "suitable for framing" are available upon request to the NHBA.

Authors

Suzanne Morand, AAI, CIC, is senior account executive for the NHBA Insurance Agency. She has more than 20 years of experience in the insurance industry. Contact her toll-free at (866) 642-2292; the NHBA main number (603) 224-6942, or by e-mail at smorand@nhbar.org.

Denice DeStefano is the NHBA Assistant Executive Director and staff liaison to the Dispute Resolution Committee. Contact her at 224-6942 or at ddestefano@nhbar.org.